The market breadth continued to remain highly negative as the combined exchange figures were 1194 : 2680. The capitalisation of the breadth on a commensurate basis was negative too as the figures were Rs 7,822 crore : Rs 10,457 crore.
The markets closed at the upper end of the intraday range as the bulls displayed resilience at lower levels. That the market internals were negative is a sign of continued unwinding bias in undertone. The 4860 / 4620 range advocated for Tuesday held as the Nifty traded within these parameters.
The Nifty was unable to test the 4790 level which was the bearish pivot advocated for the day. That indicates scepticism where potential large-scale buying conviction is concerned. The coming session is likely to witness a range of 4780 on advances and 4650 on declines. The 4700 level will be a bullish threshold.
The market internals indicate a higher turnover as the participation levels rose. The number of trades increased and the average ticket size was higher, showing some buying bias. The capitalisation of the market was lower.
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The outlook for the markets on Wednesday is that of guarded optimism as the market appears to be nearing an oversold level and may attempt a small bounce. Avoid big ticket trades.